SHRED

When you're in a global super cycle, Dips are meant for buying.

@ZahiY11 1. Yield on the ETH basis is around 3-4%, which is why we needed to add new ones. The other strategies are yielding around 8-10%. 2. The strategies we're looking at involve Pendle PTs and tokenized gold. 3. Yes. We're bullish on the precious metals across multiple timeframes.

@SHREDfi 1. What’s the approximate current yield today on these strategies? 2. Which tokens are you targeting? 3. Is gold one of those strategies ? Many thanks 🙏

Initially, we were going to run one strategy to generate yield for our stable depositors. Now, we are planning to offer 2-3 yield strategies & allocating dynamically between them. This diversification provides more stable & predictable returns, regardless of the market cycle.

Our industry is maturing. DeFi and TradFi are merging into one and we're simply calling it "financial services." The verticals clearly making the leap so far are: - bitcoin - stablecoins - equity infra - tokenization

Funding rate arbitrages on Hyperliquid: Arb ETH/BTC Arb Oil Arb Gold Arb Stocks Arb Commodities The opportunities are endless.

Binance Research confirms what we believe to be true. The crypto markets have bottomed and we will begin a slow and steady rise that eventually transforms into a full blown institutional super cycle.

Our team has been fully distributed since day one. We operate from 6 different countries around the world. As we use are using AI more in our day-to-day operations, we find that the digital nature of remote work is giving us an advantage. Intelligence is built into everything.

Points programs are out of favor right now, but we don't think that'll last forever. It's a short-term response to market sentiment from bearish price action. Want to maximize our upcoming points program? - deposit early - go bigger - stay longer = pays better

Top 10 positive news developments in our industry last month (April 1 - May 11): • Coinbase Receives Landmark National Bank Trust Charter - The OCC's approval allows Coinbase to act as a fiduciary, clearing the path for massive institutional pension and insurance capital to enter on-chain yield strategies. • Stablecoin Market Cap Surpasses $310B as Transaction Volume Hits $46T - Stablecoin supply has grown past $310 billion with annualized transaction volume reaching $46 trillion, cementing stablecoins as a core financial infrastructure layer and expanding the addressable market for yield products built on top of them. • White House Report Backs Stablecoin Yield - Finds Ban Would Boost Bank Lending by Only 0.02%. The Council of Economic Advisers concluded that prohibiting yield "would do very little to protect bank lending, while forgoing the consumer benefits of competitive returns," undermining the banking lobby's core argument against yield-bearing stablecoins. • Apollo Global Takes Up to 9% Governance Stake in Morpho - The $940B asset manager signed a 48-month token acquisition agreement, the largest TradFi-to-DeFi governance deal to date, while Frambot signals that large allocators are abandoning shared liquidity models for isolated vaults with granular risk and compliance control. • Fireblocks Launches "Earn" for Institutional Stablecoin Yield - The custody platform serving 2,400+ institutions and $6T in stablecoin volume shipped native access to Aave and Morpho lending within existing compliance workflows, turning idle settlement capital into a revenue line. • Liminal Custody Expands Institutional Infrastructure into APAC - The platform has partnered with major Asian telecom and tech firms to deploy regulated custody solutions following a successful pilot program in Taiwan, signaling institutional DeFi adoption is going global. • Morpho Launches "Morpho Midnight" Fixed-Rate Lending - A new fixed-term, fixed-rate protocol where rates are discovered by the market rather than set by formulas, targeting institutional demand for predictable onchain return profiles that mirror traditional term deposits. • Zodia Custody Forecasts DeFi as the Primary Institutional Yield Rail - A new industry report highlights 2026 as the year DeFi transitions from experiment to infrastructure, driven by looped strategies using tokenized U.S. Treasuries as the base yield layer. • Ethereum Foundation Deposits $19M into Morpho Vaults for Treasury Yield - The largest ecosystem foundation in crypto allocated nearly $19 million into Morpho's curated lending vaults, signaling that even non-profit protocol treasuries now view onchain yield as a standard treasury management tool rather than a speculative activity. • Institutional LPs Demand Pre-Execution Transparency Over Points Farming - Large-scale liquidity providers are moving away from incentive-chasing toward protocols offering verifiable proof of reserves and advanced risk mitigation, accelerating a structural shift from retail-native growth loops to institutional-grade underwriting standards.

An important part of our delta-neutral strategy involves something called "looping". This essentially means we use Aave to get leverage on our ETH spot exposure to match our leveraged ETH short on Hyperliquid. Here's how it works: - Stablecoins (like USDC) are deposited into SHRED. - We use part of them to buy wstETH (Lido's staked ETH). - The wstETH goes into Aave as collateral. - We borrow more stablecoins against it. - Those stablecoins get swapped into wstETH and redeposited into Aave. - The cycle repeats until the long position sits at roughly ~2x leverage Why do we do this? Because it's more capital efficient. As mentioned earlier in this post, we need leveraged ETH exposure on the long side to match leveraged ETH shorts on Hyperliquid. The shorts capture the funding rate (where our yield comes from). The long side exists to neutralize the price risk (what it means to be delta-neutral). If ETH drops, the Aave position tightens. When it does, the system reduces leverage or adds collateral before we lose money. Without looping, the same delta-neutral position would need roughly twice the capital.

Quick explainer of our protocol "Health" dashboard. Want even more transparency? Let us know what else you'd like to see so we can add it.

Protocol Health Dashboard: • TVL Over Time (#) • Performance Over Time (%) • Protocol Backing Ratio (%) • Total Users (#) • Yield Generate for Users (%) • Funding Rate Days (pos/neg) More coming soon.

We have discovered some promising new DeFi strategies to diversify the source of yield beyond perps funding rate arbitrage for @SHREDfi We will report back soon.

When we launch we will do so with a public points campaign. It's the best way for us to reward our early adopters and kickstart the protocol. Learn more about our Leaderboard now so you're prepared when the time comes.